Albano v. Shea Homes Ltd. P'ship

• Decision Date: 30 June 2011
• Docket Number: No. CV–11–0006–CQ.,CV–11–0006–CQ.
• Citation: 227 Ariz. 121,254 P.3d 360
• Parties: Alfred ALBANO, an unmarried man; Monica Lewis, an unmarried woman; Samantha Baker, an individual; Ariel Barr, an unmarried man; Phillip Barr, a single man; Keith Bodie, husband; Stacy Bodie, wife; Jon L. Bruce, an individual; Craig Burke, husband; Linda Burke, wife; Dawn R. Cain, an individual; Christina Carlson, an individual; Charles Chen, husband; Lisa Chen, wife; Christopher Cordasco, an individual; Paul Crandell, husband; Jennifer Crandell, wife; Kent Ellsworth, husband; Lauree Ellsworth, wife; Ronald Filipski, husband; Laura Filipski, wife; Angelica Harvey, an individual; Dirk Howard, husband; Nancy Howard, wife; George Hulecki, husband; Jeanne Hulecki, wife; Candace Hurtt, wife; James Craig, husband; Robert Kegerreis, Trustee of the Kegerreis Family Trust u/a/d June 15, 2005; Cynthia Kegerreis, Trustee of the Kegerreis Family Trust u/a/d June 15, 2005; John R. Letteer, husband; Judith Letteer, wife; Kelly J. Mallory, an individual; Charles McGoldrick, husband; Maureen McGick, wife; Robert L. Mitchell, a single man; Beatrice M. Linne, an unmarried woman; Richard Navarro, an individual; Scott A. Olmstead, husband; Amber S. Olmstead, wife; Donald W. Roberts, husband; Julia A. Roberts, wife; Linda S. Rodela, an individual; Jack E. Rose, Jr., husband; Shawna R. Rose, wife; Mark B. Samford, husband; Rebecca L. Samford, wife; Jane D. Schmaltz, an individual; Richard Scott, husband; Sharon Scott, wife; Dennis Simpson, an individual; Blake Slaughter, husband; Chantell Slaughter, wife; Bruce Tarman, husband; Janelle Tarman, wife; Michael L. Tomaino, II, an individual; Eric T. Valimaki, husband; Cristi D. Valimaki, wife; David A. Wenman, husband, as Trustee of the Wenman Family Trust dated July 9, 1999; Jacqueline Diane Wenman, wife, as Trustee of the Wenman Family Trust dated July 9, 1999; Seth Wheeler, husband, on his own behalf and on behalf of all others similarly situated; Jacqueline Wheeler, wife, on her own behalf and on behalf of all others similarly situated; Phillis J. Simpson, an individual, Plaintiffs–Appellants,v.SHEA HOMES LIMITED PARTNERSHIP, an Arizona limited partnership; J.F. Shea Co., Inc., a Nevada corporation, dba Shea Homes, Defendants–Appellees.
• Court: Arizona Supreme Court

227 Ariz. 121

254 P.3d 360

Alfred ALBANO, an unmarried man; Monica Lewis, an unmarried woman; Samantha Baker, an individual; Ariel Barr, an unmarried man; Phillip Barr, a single man; Keith Bodie, husband; Stacy Bodie, wife; Jon L. Bruce, an individual; Craig Burke, husband; Linda Burke, wife; Dawn R. Cain, an individual; Christina Carlson, an individual; Charles Chen, husband; Lisa Chen, wife; Christopher Cordasco, an individual; Paul Crandell, husband; Jennifer Crandell, wife; Kent Ellsworth, husband; Lauree Ellsworth, wife; Ronald Filipski, husband; Laura Filipski, wife; Angelica Harvey, an individual; Dirk Howard, husband; Nancy Howard, wife; George Hulecki, husband; Jeanne Hulecki, wife; Candace Hurtt, wife; James Craig, husband; Robert Kegerreis, Trustee of the Kegerreis Family Trust u/a/d June 15, 2005; Cynthia Kegerreis, Trustee of the Kegerreis Family Trust u/a/d June 15, 2005; John R. Letteer, husband; Judith Letteer, wife; Kelly J. Mallory, an individual; Charles McGoldrick, husband; Maureen McGick, wife; Robert L. Mitchell, a single man; Beatrice M. Linne, an unmarried woman; Richard Navarro, an individual; Scott A. Olmstead, husband; Amber S. Olmstead, wife; Donald W. Roberts, husband; Julia A. Roberts, wife; Linda S. Rodela, an individual; Jack E. Rose, Jr., husband; Shawna R. Rose, wife; Mark B. Samford, husband; Rebecca L. Samford, wife; Jane D. Schmaltz, an individual; Richard Scott, husband; Sharon Scott, wife; Dennis Simpson, an individual; Blake Slaughter, husband; Chantell Slaughter, wife; Bruce Tarman, husband; Janelle Tarman, wife; Michael L. Tomaino, II, an individual; Eric T. Valimaki, husband; Cristi D. Valimaki, wife; David A. Wenman, husband, as Trustee of the Wenman Family Trust dated July 9, 1999; Jacqueline Diane Wenman, wife, as Trustee of the Wenman Family Trust dated July 9, 1999; Seth Wheeler, husband, on his own behalf and on behalf of all others similarly situated; Jacqueline Wheeler, wife, on her own behalf and on behalf of all others similarly situated; Phillis J. Simpson, an individual, Plaintiffs–Appellants,

v.SHEA HOMES LIMITED PARTNERSHIP, an Arizona limited partnership; J.F. Shea Co., Inc., a Nevada corporation, dba Shea Homes, Defendants–Appellees.

No. CV–11–0006–CQ.

Supreme Court of Arizona, En Banc.

June 30, 2011.

Burdman & Shore PLLC by William F. Shore, III, Robert E. Barry, Robert H. Willis And Paul G. Ulrich, PC, By Paul G. Ulrich, Phoenix, Attorneys for Alfred Albano, Monica Lewis, Samantha Baker, Ariel Barr, Phillip Barr, Keith Bodie, Stacy Bodie, Jon L. Bruce, Craig Burke, Linda Burke, Dawn R. Cain, Christina Carlson, Charles Chen, Lisa Chen, Christopher Cordasco, Paul Crandell, Jennifer Crandell, Kent Ellsworth, Lauree Ellsworth, Ronald Filipski, Laura Filipski, Angelica Harvey, Dirk Howard, Nancy Howard, George Hulecki, Jeanne Hulecki, Candace Hurtt, James Craig, Robert Kegerreis, Cynthia Kegerreis, John R. Letteer, Judith Letteer, Kelly J. Mallory, Charles McGoldrick, Maureen McGick, Robert L. Mitchell, Beatrice M. Linne, Richard Navarro, Scott A. Olmstead, Amber S. Olmstead, Donald W. Roberts, Julie A. Roberts, Linda S. Rodela, Jack E. Rose, Jr., Shawna R. Rose, Mark B. Samford, Rebecca L. Samford, Jane D. Schmaltz, Richard Scott, Sharon Scott, Dennis Simpson, Blake Slaughter, Chantell Slaughter, Bruce Tarman, Janelle Tarman, Michael L. Tomaino, II, Eric T. Valimaki, Cristi D. Valimaki, David A. Wenman, Jacqueline Diane Wenman, Seth Wheeler, Jacqueline Wheeler, and Phillis J. Simpson.Mariscal Weeks McIntyre & Friedlander PA By Gary L. Birnbaum, Barry R. Sanders, Stephen E. Richman And Righi Hernandez Law Firm By Jill Ann Herman, Phoenix, Attorneys for Shea Homes Limited Partnership and J.F. Shea Co., Inc.Bonnett Fairbourn Friedman & Balint PC By Francis J. Balint, Jr., Kevin R. Hanger, Phoenix, Attorneys for Amicus Curiae Public Justice PC.Koeller Nebeker Carlson & Haluck LLP By William A. Nebeker, Troy G. Allen, Rachel C. Nies, Melissa J. England, Phoenix, Attorneys for Amicus Curiae Home Builders Association of Central Arizona.Kasdan Simonds Weber & Vaughan LLP By Kenneth S. Kasdan, Stephen L. Weber, Michael J. White, Phoenix, Attorneys for Amicus Curiae Concerned Consumers of Sun City Grand.

Folk & Associates PC By P. Douglas Folk, Heather K. Seiferth, Phoenix, Attorneys for Amicus Curiae American Council of Engineering Companies of Arizona, AIA Arizona and Structural Engineers Association of Arizona.

OPINION

PELANDER, Justice.

¶ 1 We accepted jurisdiction to answer three questions certified to us by the United States Court of Appeals for the Ninth Circuit:

1. Does the filing of a motion for class certification in an Arizona court toll the statute of limitations for individuals, who are included within the class, to file individual causes of action involving the same defendants and the same subject matter?

2. If so, does this class-action tolling doctrine apply to statutes of repose, and more specifically, to the statute of repose for construction defects set forth in Arizona Revised Statutes (“A.R.S.”) § 12–552?

3. If the doctrine applies to statutes of repose, and specifically § 12–552, may a court weigh the equities of the case in determining whether, and to what extent, an action is tolled?

We have jurisdiction pursuant to Article 6, Section 5(6) of the Arizona Constitution, A.R.S. §§ 12–1861 to 12–1867 (2003), and Arizona Supreme Court Rule 27.

¶ 2 Although the issue posed by the first question is not directly presented here, we assume without deciding that the timely filing of a class action complaint in Arizona tolls the applicable statute of limitations for all non-named putative class members from the date the complaint is filed until an order denying class certification is entered. We answer the second certified question in the negative and, therefore, find it unnecessary to answer the third question.

I

¶ 3 The Ninth Circuit's amended certification order details this litigation's lengthy history. See Albano v. Shea Homes Ltd. P'ship, 634 F.3d 524, 526–29 (9th Cir.2011). Briefly, plaintiffs Alfred Albano and two other homeowners appealed to the Ninth Circuit from the district court's summary judgment dismissing their construction-defect claims against Shea Homes Limited Partnership and J.F. Shea Co., Inc. (collectively “Shea Homes”) as barred by Arizona's statute of repose, A.R.S. § 12–552 (2003). The case pending before the Ninth Circuit is the third of four related lawsuits alleging construction defects in homes located in a Shea Homes planned community (Carriage Lane) in Gilbert.

¶ 4 The first case (“ Hoffman ”) was filed as a putative class action against Shea Homes in superior court in June 2003. The named plaintiffs did not move for class certification until November 2005. In February 2006, the superior court denied that motion, both as untimely and for failure to establish the “ ‘typicality’ and ‘commonality’ ” of claims required for class certification under Arizona Rule of Civil Procedure 23. The court also denied the plaintiffs' motion to add eighty-six new plaintiffs. The three named plaintiffs in Hoffman later settled their claims.

¶ 5 The second case against Shea Homes was filed in 2006 by Carriage Lane homeowners not allowed to join Hoffman. After serving a Notice and Opportunity to Repair (“NOR”) on Shea Homes, those homeowners filed a new action (“ Albano I ”) in superior court. That action, however, was dismissed because the plaintiffs did not respond to the defendants' offers to repair, as required by the Arizona Purchaser Dwelling Act, A.R.S. § 12–1363 (2003).

¶ 6 Thereafter, the Albano I plaintiffs sent additional NORs to Shea Homes, and on November 5, 2007, filed a third action in superior court (“ Albano II ”) against Shea Homes. The defendants removed the case to federal court and moved for summary judgment, asserting that the action was barred by the eight-year statute of repose in § 12–552(A).

¶ 7 Before responding to the motion, the plaintiffs filed another action in superior court (“ Albano III ”), naming as the only defendant Shea Homes Arizona Limited Partnership. The case was removed to district court and consolidated with Albano II. Shea Homes filed a motion for summary judgment in Albano III, which posed the same issue as the Albano II motion—whether plaintiffs' claims were time-barred by the statute of repose or, instead, whether the statute's eight-year period was tolled between the filing of the Hoffman putative class action and the superior court's denial of class certification in that case.

¶ 8 The district court found plaintiffs' claims were time-barred. The court was persuaded that this Court would adopt the tolling rule for class actions recognized in American Pipe and Construction Co. v. Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974). The district court also concluded that American Pipe tolling could apply to the statute of repose at issue, A.R.S. § 12–552(A).

¶ 9 Applying American Pipe to the plaintiffs' claims, however, the court concluded that tolling could not save the Albano III action because the tolling rule “presupposes that the defendant is identical in both the class action suit and the individual class members' suits.” Shea Homes Arizona Limited Partnership was not a defendant in Hoffman.

¶ 10 With respect to Albano II, the district court concluded that tolling was only appropriate from the filing of plaintiffs' motion for class certification on November 2, 2005, until the denial of that motion on February 24, 2006. The court refused to toll the statute of repose for the nearly two and a half years that it took the Hoffman plaintiffs to move for class certification, finding “such prolonged tolling unwarranted.” Without the benefit of tolling for the entire period from the filing of Hoffman until the denial of class certification, the district court concluded, plaintiffs' claims were untimely.

¶ 11 On appeal,¹ plaintiffs contended that the district court...